Russia offers to send Kazakh oil to Belarus

May 25. Reuters. MOSCOW

* Oil pipeline operator Transneft ready to send Kazakh oil
* Russia would then lower its own shipments to Belarus
* To redirect oil from Belarus pipeline to BTS-2 pipeline

Russia offers to send Kazakh oil to BelarusRussia’s oil pipeline monopoly Transneft TRNF.MM has offered to ship Kazakh oil to Belarus in exchange for lower Russian crude shipments, but the total amount of oil in the Transneft system would remain the same.

“We are ready to give Kazakhstan the possibility to supply oil to Belarus. We (Russia) can then lower our supplies,” Transneft spokesman Igor Demin told Reuters on Wednesday.

Kazakh traders told Reuters, however, that sending oil to Belarus was not as attractive as shipping to Gdansk in Poland and to Russia’s Primorsk port.

“Russia is playing its own chess game. It wants to solve its problems at Kazakhstan’s expense,” a trader for a Kazakh oil company told Reuters.

“That, and we don’t have any free volumes. We would have to take volumes away from other routes and that’s not profitable for us,” he said.

RUSSIA LAUNCHES NEW PIPELINE, REDIRECTS FLOWS

Demin also said that at the end of the summer Transneft would launch its newly constructed BTS-2 pipeline spur to which it will redirect 650,000 tonnes of crude flows for Belarus’ Naftan refinery that currently travel north from Russia through the Belarussian pipeline system.

The new BTS-2 route will then carry a total of 800,000 tonnes of oil each month from the town of Unecha, up to the Russian border town of Andreapol and west across the border to Polotsk where the Naftan refinery is located.

“There will be no change in export volumes, only the route will change,” he said.

Russia exports 1.5 million tonnes of oil every month to Belarus. It constructed the Baltic Pipeline System, or BTS, to bypass Belarus. When Transneft moves supplies to BTS-2, Belarus’ oil pipeline operator will lose all its transportation earnings.

Since Jan. 1, Russia, Belarus and Kazakhstan are in a customs union together, meaning that Minsk no longer has to pay Russian oil tariffs but must hand over to Moscow all the duties it collects from exporting oil products refined from Russian crude.

http://af.reuters.com/article/energyOilNews/idAFLDE74O29Y20110525?pageNumber=1&virtualBrandChannel=0

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